First drive: Honda Insight

It's almost a decade since Honda first launched the Insight hybrid in Australia. The quirky two-seater with its miserly fuel consumption, average driving dynamics and stratospheric price tag never did catch on, with about 55 units sold in five years.

But this new generation Insight is a different beast altogether. For a start, at $29,990 it's the cheapest petrol-electric hybrid you can buy. It's also pretty attractive in the flesh and Honda says it's more fun to drive than rival (read Toyota) hybrids.

But step into the cabin and you get a good idea of how Honda managed such a sharp price for the car. It's pretty well equipped, with six airbags, stability control and standard Bluetooth, but the cabin is dominated by hard shiny plastic and cheap materials on the seats, doors and floor. The rear load area is shallow but wide, and you can fold the rear seats flat to liberate more room for cargo. The rear seats also have decent legroom, although the seats themselves are a little hard and unsupportive.

Overall, it's not an unpleasant place to be, but up against a similarly-priced Volkswagen Golf, it looks and feels fairly basic.

Things improve when you turn the key, though, and the little Honda slowly begins to endear itself to you. As you take off, the first thing you'll notice is the speedo readout changes colour depending on how you drive. Floor the accelerator and the background glows a deep blue, back off a little and it turns a lighter shade of blue before morphing into green when you're up to speed and cruising.

Another meter shows you whether you're braking and accelerating too sharply, ruining you fuel consumption, while a third read-out rewards you with little digital "trees" that grow bushier the less fuel you consume. It's all designed to eke more mileage out of a car that on its own has a pretty impressive fuel consumption story to tell. The Insight uses just 4.6 litres of fuel per 100km on the official cycle.

The Insight also has an ECO button that reduces fuel consumption by limiting engine power, reducing throttle response and lowering air-conditioning performance while increasing the level of regenerative braking, which feeds power back into the batteries when the car is slowing. The engine can also deactivate cylinders to save fuel, and shut down when the car is stopped at traffic lights.

Overall, the fuel-saving aids are a definite attraction for drivers who are interested in saving fuel and the planet. And let's face it, you're not going to spend thousands of dollars extra on a hybrid car if you don't have an environmental bent.

Usually, hybrid techno-wizardry such as this is designed distract you from the fact that the actual driving experience is fairly dull and unrewarding, but Honda says that's not the case with the Insight.

Although the car's engine transmits its power to the wheels via a continuously variable transmission, which doesn't change gears like a normal auto, Honda has included F1-style shift paddles on the steering wheel for those who want to explore the car's performance limits on a winding bit of back road.

Even with the paddles in play, progress in the Insight is by no means rapid, and the little petrol engine needs to be revved hard to produce its best. It's also pretty noisy in the process, which detracts a little from the fun factor.

On the road, the Insight is definitely more surefooted and rewarding through corners than its main rival, the Toyota Prius. The steering is a little light and darty, but it tracks faithfully, while the Honda soaks up bumps and corrugations on country back roads without getting unsettled. It does get a little fidgety and sharp at low speeds around town, but overall it's a well-rounded performer.

We managed to get 6.4 litres per 100km out of the car on our mostly rural drive without any effort to drive economically. Others who kept an eye on the fuel gauge managed as low as 4.3 litres per 100km. But the Honda is likely to come into its own around town rather than in the country, where its official consumption is jus 4.9 litres per 100km, while conventional petrol small cars will use as much as 11 litres per 100km.

In isolation, the Insight is an intriguing prospect. It's fuel-efficient for a small car and affordable for a hybrid. It's also pretty entertaining to drive and the cabin, while a little stark, is practical and roomy for a small car. But up against similarly-priced small cars such as the Volkswagen Golf - or slightly more expensive larger hybrids such as Toyota's Hybrid Camry, it comes out looking a little pricey.

It may be the cheapest hybrid on the market, but you're still paying a decent premium for the kudos of having an alternative fuel vehicle.

Then again, if you're obsessed with fuel consumption, the array of fuel-saving gadgets and displays in the cabin is pretty addictive.